Two Views: Three reasons Medicaid expansion won't work (and what to do instead)

The re-election of Louisiana Gov. John Bel Edwards, who made protecting his state's expanded Medicaid program a key campaign issue, has some pundits excited about the chances of expanding Texas' own government-run healthcare system.

What these pundits fail to realize, however, is that neither an election nor the elation surrounding it make Medicaid expansion a sound policy decision. It turns out that a bad idea is a bad idea, no matter which person or party wins a gubernatorial election.

To better understand why expanding Texas' Medicaid program would be a mistake, consider these three things.

• Medicaid expansion won't make people healthier. The truth is coverage isn't care. Just because someone has government-issued insurance doesn't mean they'll get the health care they need. Consider the Veterans Administration's 2015 internal audit, which found that as many as 307,000 veterans died while waiting to see the doctor. This jarring bureaucratic failure and others like it have been nicknamed death by queuing. As one of my colleagues once described it: "You wait so long for the medical care you need that the disease gets you before the doctor does."

• Medicaid expansion won't mean more people get to see a doctor. Even if the state's program was expanded, patients would likely be hard-pressed to find many physicians willing to see them. In fact, a 2016 survey by the Texas Medical Association suggested that less than half of Texas doctors would be willing to accept new Medicaid patients, primarily because of low reimbursement rates and the bureaucratic burden that comes along with it. Expansion could greatly exacerbate this problem.

• Medicaid expansion won't mean people pay less. Government programs run on public money. Even when Washington, D.C. offers to cover the cost, there can still be a price to pay. For an example, look to Texas' neighbor to the west.

A few years ago, New Mexico expanded its Medicaid program with the expectation it would receive as much as $3 billion from the federal government. However, more people than expected signed up, resulting in a total cost of $3.4 billion. Faced with that $417 million shortfall, New Mexico policymakers had to lower reimbursement rates and make some patients pay new costs.

If expanding Texas' Medicaid program isn't the right policy prescription, then what should policymakers do?

From an economic perspective, the best solution is to create a prosperous environment where people can flourish and find independence. In that way, individuals and families can get themselves off of government assistance entirely.

From a structural standpoint, Americans need the federal government to get out of the way. Right now, Washington, D.C. controls a one-size-fits-all apparatus that treats many different people in many different states, including Texas, all the same. That's produced the incredibly costly, complex, and counterproductive system that we all live under today.

Instead of this system (or its expanded cousin), Americans need Washington to return authority and autonomy back to every state legislature. Let state lawmakers decide "how to structure their healthcare both for the medically needy and the general population."

These types of state-centric ideas offer the best hope of curing what ails the U.S. health care system today.

Quintero leads the Think Local Liberty project at the Texas Public Policy Foundation.

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